For haven’s sake: Gold, silver continue to rally

Mumbai: Prices of gold and silver jumped to record highs in the domestic market on Tuesday following international price trends over the extended weekend in India as investors globally continued to shift to haven assets as geopolitical tensions remained at elevated levels. For silver in particular, rising demand from several of the fast-growing industries like EV, semiconductors, solar and smart grids, at a time when supply is stagnant, is fuelling the rally globally, market players said.During the day, in the spot bullion market in India gold traded above the Rs 1.6 lakh/10gm level while silver traded at above Rs 3.6 lakh/kg mark, both all-time high levels. In late trades, however, the prices softened a bit as internationally prices of these two precious metals saw some correction. After rallying to above $5,100/ounce (Oz) and $114/Oz, gold and silver prices, respectively, were hovering below the $5,100 and $108 levels.In late trades on the MCX, gold futures for Feb delivery were trading at Rs 1.58 lakh/10 gm level, down from Rs 1.59 lakh earlier, while silver futures for March delivery were trading at Rs 3.6 lakh/kg level, down marginally from Rs 3.65 lakh earlier in the session.While the rally in yellow metal is based on safe haven demands and slipping confidence in dollar as a fiat currency, multiple factors are powering the rally seen in white metal.“Silver now derives nearly two-thirds of its demand from industrial uses—solar, electronics, EVs, AI hardware and smart grids—placing it at the centre of the global energy and digital shift,” Kotak Mutual Fund noted in a blog post titled ‘Silver is the new rare earth: The shiny metal changing our world’.“With silver largely mined as a by-product and ore grades falling, supply cannot keep pace with demand, resulting in a (about) 230 million oz deficit in 2025 and persistent market tightness,” the fund house said. “India became the largest importer of refined silver in 2025, (at) $9.2 billion, up about 44% on the year, driven by substitution from gold, festive demand, and the expansion of solar and electronics manufacturing.”